Facing Ruin From Lawsuits, Anglicans in Canada Slash Budget

By JAMES BROOKE

Published: August 23, 2000

TORONTO, Aug. 21—
With lawsuits by former students of Indian boarding schools threatening to bankrupt the Anglican Church of Canada, this week the church started slashing its national budget by 11 percent.

The cuts come after an audit by the accounting firm Ernst & Young predicted that legal fees and settlements arising from charges of past abuses at boarding schools run by the church would bankrupt the organization next year.

''I don't know if the leadership is in denial,'' said David Harris, editor of The Anglican Journal, the church's newspaper here. ''But I think people were expecting more drastic cuts.'' To save money for legal bills, the newspaper is to be made smaller and eight staff members here who work for the church's national structure, the general synod, are to be laid off.

From the late 19th century until 1970, boarding schools for Indian children were run by four Christian churches in Canada: Roman Catholic, Anglican, United and Presbyterian. The churches were fulfilling a government policy of teaching English to Canadian Indians, assimilating them into Canadian society and training them for lives beyond traditional hunting and gathering.

Through the 1960's, about 20 percent of Canadian Indian children passed through the schools, often in isolated places. In recent years, there have been complaints ranging from accusations that administrators failed to crack down on pedophiles to charges of destruction of cultures, religions and languages.

Today, the Anglican Church, which ran 37 schools, the second-largest number after the Catholic Church, is the target of 350 lawsuits, representing 1,600 plaintiffs. Last year, the synod, which has assets of $7 million, spent $1 million in legal fees.

While most dioceses are legally insulated from claims, the national organization and three western dioceses are threatened with bankruptcy. The Anglican Church and the Catholic Church, which faces claims by 4,110 plaintiffs, have asked the federal government to help negotiate and pay for a settlement.

So far, such pleas have been rejected by the government of Prime Minister Jean Chretien, who was Indian affairs minister from 1968 to 1974. Two years ago, when the Chretien government created a $250 million ''healing fund'' to pay for social projects in Indian communities, a cabinet minister was quoted as saying: ''The churches have got to feel some pain.''

In the new Anglican budget, money devoted to a healing fund is to be doubled, to $370,000. But elsewhere Indian communities will feel financial pain. Hundreds of thousands of dollars will be cut from transfers to the Canadian north, where many Anglican churches are supported by the national organization.

The courts have found that the churches and government share responsibility for abuses at church-run schools.

In a rare government comment on the issue, Shawn Tupper, director of the residential school division of the Department of Indian and Northern Affairs, told The National Post last month that churches should dig more deeply into their pockets to settle claims. The Anglican Church, Canada's third largest, has 2.2 million members.

''They should ask their own membership ahead of asking the taxpayer,'' said Mr. Tupper, whose agency is reported to have 150 lawyers working full time fighting claims.